Energy Efficiency Policy In California

Transcription

1 Energy Efficiency Policy In California March 20, 2006 Steve McCarty Director Demand-Side Resources 1

2 Today s Discussion Who We Are and What We Do What is Energy Efficiency? Why We Do Energy Efficiency How Energy Efficiency Happens Where We ve Been The Future of Energy Efficiency at PG&E 2

3 Click to edit Master title style California s Investor Owned Utilities (IOUs) 3

4 PG&E Click to edit Master title style Who We Are & What We Do The largest investor-owned system of its kind in the USA Provides power to approximately 14 million people 1 in 20 Americans Serves a 70,000 square-mile area in northern and central California Plans to invest more than $2 billion on energy efficiency initiatives over the next 10 years 4

5 Click PG&E s to edit Generation Master Portfolio title style 2005 Electric Supply (82,936 GWh) Independent Power Producers 24.9% Other 5.7% Nuclear Power 21.3% State of CA Contracts 27.3% Fossil 1.2% Hydro 19.6% 5

6 California s Electric Supply Supply has been adequate in Northern California Future adequacy & price of supply remain concerns given growth and generation retirements Capacity additions, demand response and energy efficiency are all identified and agreed upon components of the real resource mix 6

7 What is Energy Efficiency? Investments in equipment, controls, or facility design that reduce energy use while maintaining a comparable level of service as perceived by the customer. 7

8 What is Energy Efficiency? Energy Efficiency: Cost-effective reductions in a customer s demand for gas and electricity The least-cost, cleanest and most quickly deployed resource option available to utilities The preferred resource regardless of what electric industry structure exists 8

9 Why We Do Energy Efficiency When energy usage is lower, most utility costs drop as long as energy efficiency reduces demand (8-20 years) Costs that drop: Fuel Generation plant capital costs Distribution upgrades deferred/avoided Transmission upgrades deferred/avoided Transmission and distribution losses And societal costs are lower: Air and water pollution 9

10 Why We Do Energy Efficiency It is cost effective Our customers expect it It protects the environment 10

11 How Energy Efficiency Happens Major barriers that contribute to insufficient purchases of cost-effective, energy-efficient goods and services: Imperfect information Consumer attitudes Limited access to capital Product lifecycles Electric rate distortions and regulatory uncertainty Externalities 11

12 How Energy Efficiency Happens Influence customers choices through a diverse portfolio offering: Education and Outreach Energy Audits Technical Assistance Rebates Loans Emerging Technologies 12

13 The Eras of Energy Efficiency in California 70s Conservation 80s Demand-side Management 90s Energy Efficiency as a Resource Energy Efficiency Restructuring 01 Energy Crisis 02 Continued Uncertainty 03 Energy Efficiency as a Resource 13

14 Megawatts Saved by California s Investor Owned Utilities * * About one percent of total demand 14

15 After the Energy Crisis: New Framework for Energy Procurement In 2002, the CPUC adopted a new framework for utility procurement of power: Energy efficiency now integrated into utility resource plans Utilities are required to consider cost-effective energy efficiency in their procurement plans This has led to significantly increased investment 15

16 California Energy Action Plan Adopted by the California Public Utilities Commission, Energy Commission and Power Authority in Spring 2003 Emphasizes energy conservation and resource efficiency as a first priority for California s energy policy Recognizes that energy efficiency programs are among the most important tools in meeting California s energy needs Expects energy efficiency to capture approximately 6 of the 11GWs in demand growth over next decade 16

17 Integrated Resource Plans Follow a Loading Order of Resources The loading order prioritizes the types of resources utilities and other load serving entities must secure: 1. Energy Efficiency 2. Demand Reduction 3. Renewables 4. Distributed Generation 5. Efficient, Clean Fossil-fueled Centralstation Generation 6. Transmission 17

18 PG&E s Energy Efficiency Funding & Goals Year 2006 Current Budget ($ Millions) $276 MWs 180 GWhs 829 Therms (MMTh/yr) $ $ , TOTAL $ ,

19 Energy Efficiency Funding Year by Utility per ($s Million) TOTAL PG&E $296 $350 $329 $975 SCE $232 $232 $232 $696 SDG&E $80 $91 $106 $277 SoCalGas $47 $61 $74 $182 TOTAL $655 $734 $741 $2,130 19

20 MW Goals per Year by Utility TOTAL PG&E SCE SDG&E TOTAL ,489 20

21 PG&E s Energy Efficiency Portfolio Design Programs will focus on reducing demand during peak periods: Residential More efficient new air conditioners Advanced window systems Improved efficiency of existing air conditioning systems through better maintenance Commercial and Industrial New lighting systems Chillers, motors, maintenance New Construction Improved insulation and air-flow systems Automatic daylighting systems 21

22 Energy Efficiency Lessons Learned from Electric Industry Restructuring Regulatory and Policy Requirements for Success: Develop a policy that encourages cooperation and collaboration among industry stakeholders Clearly define roles and responsibilities Maintain consistent policy direction and goals, and ensure goals are aligned with policy objectives Plan multiple-year program cycles and ensure approval Establish clear, simple and meaningful reporting requirements timely Allow administrative flexibility to respond to market conditions and make necessary program adjustments 22

23 Megawatts Saved by California s Investor Owned Utilities and Future Goals 23

24 Energy Efficiency Web Sites and Resources CA Energy Commission Research, Codes, Training and Reference Materials CA Public Utilities Commission, EE Rulemaking /static/industry/electric/ energy+efficiency/rulemaking/index.htm Commission energy efficiency policies, decisions, and related publications Pacific Gas & Electric Company (PG&E) Training, Resource Library, Programs, Rebates Demand Response Research Center Research, Reference Materials ACEEE EE Publications, Conferences EPA EnergyStar Product Listings, Technical Specifications, Reference Materials Energy Design Resources Training, Reference Materials Alameda County Waste Management Authority (ACWMA) Green Building Information, Remodeling Guidelines, New Homes Green Resource Center Green Building Information, Materials, Retailers CA Lighting Technology Center Lighting-related Research CALMAC Energy Efficiency Program Evaluations and Related Publications Association of Energy Engineers (Professional Organization, Training, Publications, References Database for Energy Efficiency Resources (DEER) Measure-level energy-savings data Energy Efficiency Best Practices Studies Publications by program and customer type documenting best practices 24